Manganese Bronze, better known as “The London Taxi Company” and maker of the iconic London’s black cab, has called in the administrators. By most accounts, the company has had problems for some time, with the market penetration and iconic status of its black cab proving both a blessing and a curse.
On the surface, it is something of a rapid fall from grace. The company had been profitable until 2007, with it signing a joint venture with Chinese car manufacturer Geely in that year. The profits, however, hid growing structural problems within the firm itself and with its flagship product. The basic design of the iconic black cab had not changed for many years, still featuring a ladder chassis for example. This, combined with customer service, pricing and after care grumbles from drivers, meant that the company’s position was arguably more fragile than it appeared on paper.
Mercedes’ entry into the London cab world with the Vito fired a warning shot across Manganese Bronze’s bows and proved to be one of the factors (alongside the new partnership with Geely) leading to the development of the TX4 in 2008, the first genuine shakeup of the black cab design for some time.
Unfortunately for the firm, the TX4 launch did not prove entirely successful. Representing the first vehicle produced in genuine partnership between Manganese Bronze and Geely, early models suffered a variety of problems. To a certain extent this was to be expected in a completely new line, but as reliability has always formed a key requirement of black cabs and a key part of their image, it was far from ideal. Issues with engine fires resulted in a partial recall in 2008, and a number of other minor niggles and problems dogged the vehicle early on.
Although these issues were all ultimately resolved, the company’s position was weakened financially and it has failed to report a profit since – in August, the firm confirmed that it already had a £3.9m hole in its accounts. Indeed four years on from its launch and initial problems a new, more serious, issue with the TX4 emerged and proved to be the straw that finally broke the camel’s back.
In February 2012 the company switched to a new Chinese supplier for the steering boxes on the TX4. Over the following months a number of them failed, with drivers reporting a loss of power and steering control. Investigations began and at the start of October, Manganese Bronze was forced to announce the urgent recall of 413 TX4s built since the supplier change, and to freeze sales on new vehicles.
Whether the issue related to manufacturing problems, or the substitution by the supplier of unapproved part, ultimately didn’t matter. With no income from sales, and the cost of the recall now on the books, the company was forced to seek additional funding. Its failure to successfully find a new financial backer, or to negotiate a new funding agreement with Geely, finally led to administration.
In many ways, the story of the company’s decline is a familiar one, especially to watchers of the automobile world. They effectively established a monopoly position in their chosen market (London taxis) and then began to stagnate. They failed to recognise the need to change for some time and their eventual attempt to innovate their way out of trouble only met with limited success. With the company’s finances now fragile, what was likely an effort to save money by switching suppliers on a key part of the TX4’s design ultimately proved to be a fatal mistake.
The question for Manganese Bronze now is “what next?” The firm employs 288 staff (170 of whom work at its assembly plant in Coventry) and both the Unite Union and Manganese Bronze Chief Executive John Russell have been vocal in the media on the need for a buyout or Government rescue of some kind.
It’s fair to say that, despite its structural problems, the likelihood of a buyer emerging for the firm is quite strong. The London taxi market may be more diverse than it used to be, and about to expand again with Nissan’s NV200 now beginning testing on the streets of the capital, but with its problems fixed the TX4 would still a force to be reckoned with – doubly so if a buyer was able to push through managerial and modernisation changes within Manganese Bronze itself.
The NV200 on the streets of London, as spotted by a reader of Auto Blog. More details can be found on their website here.
The result of the administration announcement is most likely to be a full buyout by Geely themselves, who already own 20% of the company’s shares. Manganese Bronze are not Geely’s only investment in the western car world – they own Volvo as well – and with a good deal of the manufacturing work for the TX4 taking place in China already, a full buyout seems a natural step.
The likelihood, therefore, this this announcement will mark the shock demise of the “traditional” black cab is thus very low indeed. If Geely step up then it will largely be a case of “meet the new boss, same as the old boss” but (hopefully) with some shakeup of the structure and approach that caused Manganese Bronze to get into trouble in the first place – although this may not prove to be good news for the workers in Coventry as assembly would probably move entirely to China. If not, then the firm would prove a good purchase for a new player looking to buy their way into the London taxi world – a world that remains an attractive one for manufacturers, as the efforts of both Mercedes and Nissan in recent years prove.
Either way, the TX4 and its successors will almost certainly prove to be a feature of London’s streets for some time yet.
I’m not so sure about the continued presence of the TX4. I don’t know the figures, but suspect it kicks out huge amounts of CO2 and guzzles fuel compared to more off the shelf and up to date rivals. Its ride isn’t anything to write home about, nor is its performance or interior accommodation.
Seems to me it’s got two things in its favour: distinctive looks; amazing turning circle. Not sure these will be enough if decent competitors are coming in force.
So Geely may well continue to sell it, but how many cabbies/firms will buy it?
The TX4′s tight turning circle is mandated for Hackney carriages; I seem to recall reading about Mercedes introducing an element of rear-wheel steer on the Vito to enable it to pass certification. I don’t know if the TX4′s turning circle is usefully tighter again than this requirement, though.
I’d hardly consider the TX4 to represent the first genuine shakeup of the black cab design for some time. Surely it’s just a very mild facelift of the 1997-era TX1/TXII design? (Admittedly my main source for changes from TXII to TX4 is Wikipedia, but all that lists is minor bodywork and interior styling changes.)
The simple fact is that the Mercedes Benz Vito and the proposed Nissan NV200 taxi do not cut it as black cabs and will be built in Spain. Boris can waste however many millions on his Routemaster replacement but what we really needs is a buy-out of Manganese Bronze, for the London Taxi service to be taken in house, taxi drives to be salaried rather than left to be self-employed and a fleet of eco-friendly British built cabs to be sent out on the streets of London.
Duplicated ‘this’ and missing ‘is’ first line of penultimate paragraph
“what we really needs is a buy-out of Manganese Bronze, for the London Taxi service to be taken in house, taxi drives to be salaried rather than left to be self-employed and a fleet of eco-friendly British built cabs to be sent out on the streets of London.”
Why?
a) Manganese Bronze have, as I understand it, been trying to negotiate increased financial investment into the business by Geely for some time, but have not been able to agree terms.
b) I read somewhere that the new steering box manufacturer was introduced into the suppy chain by Geely at the end of 2011.
c) Geely are now very likely to pick up all of MB “for a song” from the administrators
d) Some Chinese industrials have allegedly engaged in murky behaviour in the past.
Now, algebra was never my strong point, but A+(B*D) = C looks a bit odd to me!
philsolo
This is a time “honoured” way of doing things. Much of The City feeds on this type of behaviour.
these vehicles and their diesel engines must be contribute enough particulates to kill at least half of the Londoners who die of respiratory diseases each year. Given the low daily mileage of each vehicle – apart from the odd airport run, you would have thought that there would have been a hybrid or electrical version on city streets by now.
You all talk rubbish,I am a London taxi driver and I own a Mercedes vito and I say after 16 years of driving a London taxi I finally have a vehicle fit for purpose.
I and many other vito drivers I have spoken to will never go back to the TX4.
The problems with the TX4 is shoddy build quality,most of the parts they use are of an inferior quality the rubbers they use on suspension parts are in all honesty rubbish.
One of the local garages in Bethany green quote they have to work on 5 vitos to earn the same money as working on one TX4 I rest my case
@Anonymous
I agree, esp with all the stops & starts, low speeds, even a hybrid would hardly use it’s combustion engine. Major fuel savings.
Don’t know about daily low mileage anonymous – most cabbies I have come across these days come in from places like Southend, Colchester and Tunbridge Wells! In any case, their mileage I guess will differ little from that of the average daily London bus.
The steering box problem I believe was a serious one; their original supplier based in Coventry and mainly manufactured at Peterlee Co. Durham, albeit Japanese owned today, had far greater reliability and pedigree than the Chinese substitute.
@Anonymous 8:38
“these vehicles and their diesel engines must be contribute enough particulates to kill at least half of the Londoners who die of respiratory diseases each year.” – erm, what?! Especially “given the [supposed] low daily mileage”… There are about 20,000 taxis in London, and I’d be mightily surprised if there were as little as 200,000 other vehicles active at any time. There are 7,500 buses to start with! A bit of digging reveals that about 200,000 vehicles enter the congestion charge zone every day. And there’s a lot more of London outside that!
philsolo & Kit Green
Precisely – this is how Jowett were shatfed, back in the 50′s – their new car, the Javelin was better than ANY other mass-produced model – & Ford (?) bought out their body supplier (Briggs?), thus killing them off.
What a shame .. what a pity, nothing to do with us guv.
Geely have just pulled the same trick, it seems.
ASLEF shrugged:
The simple fact is that the Mercedes Benz Vito and the proposed Nissan NV200 taxi do not cut it as black cabs
Apparent jingoism aside, why not?
The styling of the NV200 doesn’t look from the photos like it’ll lend itself to a hugely appealing ride from a passenger point of view, due to the tiny windows and painted metal/minimal interior trim, but otherwise it looks perfectly well-suited. The Vito even more so. Tight turning circle, good access from the sliding doors, upright seating position and likely slightly greater internal height (so mitigating the slightly awkward crouch you need to do in a TX4 to get to/from your seat and pay the driver), significantly reduced emissions, quieter engines. That’s before you even consider the benefits to the driver/owner – not just Jim the cabbie’s improved reliability and build quality, but an enormous improvement on what’s always appeared to me as an occasional passenger to be a truly awful, hideously compromised cab environment, with dashboard and trim quality seemingly only a couple of steps up from a late-build Austin Maestro.
I’m sorry for any loss of jobs at Manganese Bronze, but I won’t miss the TX4. As others have pointed out, the ride for the passenger is dreadful. Did they fit wooden blocks instead of shock absorbers?
Re the comment about the NV200 having “tiny windows”. Yes, but it will have a full length glass roof, which should make for an interesting view!
Nissan have also announced that they are testing an electric powertrain in the NV200. Apparently the powertrain they use in their “Leaf” car model.
The only thing that I can see holding back the NV200 is that they appear to be launching it with manual transmission. This seems odd – when did you last ride in a manual transmission cab in London? Also seems odd to offer manual transmission given that newer automatics (such as the ZF eight speed transmission used in many large cars) now offer lower fuel consumption than a manual transmission in the same model.
Ipersonally think the tx4 is ideal for london work.easy to manouvere,roomy inside,and aside from the current recall does what it says on the tin.Over the years problems have occurred,but even going back years,speak to the old cabbies,and they will ALL moan about LTI,but we earn a living when driving the cabs.Where we have been let down,is the service given by the company,when things go wrong,BUT,if you persevere,and are polite in your dealings with them directly,they do listen,and eventually help.At the end of the day you have a choice,converted van at £6,000 above the tx,or next year the Nissan.Hopefully LTI sort the present predicament out, go forward,and continue to improve the vehicle,get drivers confidence back and go forward as a company that wants to build on its history and manufacturer a vehicle that everyone recognises,as a LONDON CAB
If I saw someone driving a vito or nv200 I would assume it was a minicab (they look like generic people carriers) mercedes or nissan could make major inroads if they redesigned the body but lacking that I suspect they wont be popular with customers.
I’d get the govt. to invest in a new fully electric cab.
Graham Feakins – most cabs make short hops around the centre of the city in their working life – that is what they should be designed to do. The commuting is the choice of the drivers – perhaps like the rest of us they could use the train service from these towns. I am puzzled that you think its OK for Londoners to die of respiratory diseases so that cabbies can have this convenience.
JP
I don’t observe any consumer resistance to the Vito, nor indeed to the Metrocab when that first came out.
But I agree it is ludicrous that TfL still allows new taxis to enter service with diesel engines. Hybrid technology is now weel established – Priuses have been with us for well over a decade and have a reputation for reliability, whilst many owners of Euro V -spec diesel cars used mainly in urban situations have reported problems with particulate filters failing to regenerate due to the lack of opportunity for a sustained run at cruising speed from time to time. (maybe that’s why cabbies commute in from the Home Counties!)
The present TX 4 has a Euro 5 Diesel engine with a Diesel Particulate Filter which pushes out almost ZERO of the emissions which are harmful. The taxi duty cycles even in London ensures the Diesel Particulate Filter regenerates, so no danger there of Londoners being harmed.
The present fiasco with a faulty steering box from a Chinese supplier is so typical of Chinese supplied goods, look the part but don’t last.
LTI should go back to UK supply for major components, even if Geely do come in with a rescue package.
The TX4 is an icon of London and with more than 20,000 operating in the City, something needs to be done to ensure a supply of decent spare parts for them for many years to come!
Anonymous on the 27th appears to be suggesting that taxi-drivers who live outside inner London but work inside it should use trains to commute. That strikes me as a pretty big ask. Most train-commuters do it because they have no choice, you cannot park in central London, and you may not have a car available anyway. Cabbies are automatically free of those problems. Train fares at commuting times are very expensive, compared to even rush-hour fuel costs. Times may be slightly better, and sometimes more predictable, but cabbies do not have fixed hours of work, they can start when they get there. Driving to work seems pretty much a no-brainer.
It would seem Manganese Bronze can now at least choose which direction to go in:
http://uk.reuters.com/article/2012/11/15/uk-manganesebronze-recall-idUKBRE8AE1R620121115
As a London cabbie I would not drive anything else. The tx4 has some slight issues, which could easily be sorted out. They are great work horses for our busy London streets, how many times when I’m driving around London a vito van, sorry taxi is slowing me down because he or she is trying to manoeuvre there vehicle as well as the lengthy ordeal trying to get wheelchair passengers into a vito. Look cabbies all like a good moan it goes with the territory, but I love my London cab, we have lost so many good things from our little island lets not loose anything else. I’m fed up with so called intellectual business men telling me lets sell off our assets and let other countries with cheaper labour do what they do best and we keep one step ahead and do what we do best.
As a humble cabbie what a load off bull, in fifty years time you will all regret that decision. When those countries are one step ahead of us we all loose.
So xmas gone,and we eagerly await news on the lti situation.Will it be TATA or Geely ?.Now have my cab back,sadly lacking a warranty the main reason i change my cab after 3yrs….Will blackhorse underwrite the warranty,i hope so,otherwise no point in making the £ payments on the vehicle.Been a good cab so far,apart frm steering box prob.And i deffo DO NOT WANT TO DRIVE A CONVERTED VAN
Now had notification from BHF that payment will be collected in January,and 2x defered payments to be tacked on to the end of finance aggreement,and as a good will gesture,will look at refunding out of pocket exes,eg taxi hire,transportation loss of earnings(3yrs accounts needed for this 1)!!.ONWARDS AND UPWARDS 2013 
I see in the news today that it’s Geely. I don’t know enough of the details to comment fully but it seems to be good news.
http://www.telegraph.co.uk/finance/newsbysector/industry/9843178/Chinas-Geely-saves-London-cab-maker-Manganese-Bronze.html